Your guide to responsible credit card use for college students

Aug 10, 2021

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

Editor’s note: This post has been updated with new information.

As a recent college graduate, I can personally vouch that I was never taught how to manage my finances in my four years of higher education. For lack of a better word, you’re expected to “adult” as soon as you enter the workforce, which makes it imperative to take your financial education into your own hands before you head out into the big, wide world.

New to The Points Guy? Sign up for our daily newsletter.

Over the past year, I’ve learned some crucial financial lessons — admittedly, the hard way for some of them. But if you’re still in college, it can actually be the perfect time to get a jump start on building credit.

From move-in to move-out day, you’ll have plenty of expenses throughout your time in school where a credit card can come in handy. Opening and managing your first credit card can be stressful and potentially perilous as you’re granted this newfound purchasing power. However, by learning how to use a credit card responsibly for both one-off and day-to-day purchases, you can build excellent financial habits that will help you for the rest of your life.

Related: TPG’s beginner’s guide to credit cards: Everything you need to know

Besides establishing credit, your first credit card can help you earn valuable rewards, from cash back to points and miles for future travel. And by the time you graduate from college, you’ll have several years of credit under your belt — necessary for securing apartment leases, car loans and mortgages.

While some of these rules for responsible credit use may seem more obvious than others, we’ll go over all of the do’s and don’ts that will help you build a solid financial future.

In This Post

Get familiar with the credit card world

There are so many credit cards to choose from that picking your first can be overwhelming. Do some research: It’s important that you select the best card for you and your lifestyle. Just because a friend raves about a card doesn’t mean it’s the right one for you.

(Photo by Olleg/Shutterstock)

TPG is dedicated to helping you make informed decisions, so start with our credit cards beginners guide and check out our wide-ranging credit card reviews. Once you get a rewards credit card, we’ll teach you all of the amazing things you can do once you start earning points and miles.

Starting out, you likely won’t qualify for any premium credit cards. For most college students, you may have a limited income from a part-time job (or possibly no income at all). But there are plenty of cards made exclusively for college students, with no annual fee and will help you start building credit. From restaurants to groceries to gas, a starter college card will reward you for these everyday purchases.

Related: Best credit cards for college students

I didn’t know any better, so I opened my first credit card out of pure convenience. Because I already owned a checking and savings account with Wells Fargo, I opened the Wells Fargo Cash Back College Card on my 18th birthday, which offered an abysmal 1% cash-back rate on all my purchases. While this card helped me build credit and opened doors for bigger and better cards down the road, there are other student cards on the market that offer better rewards rates.

The information for the Wells Fargo Cash Back College card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

(Photo by John Gribben for The Points Guy)

For students shopping around for their first card, I recommend the Journey Student Rewards from Capital One. It comes with no annual fee and encourages cardholders to build excellent credit habits from the get-go. You’ll earn 1% cash back on everything, but that earning rate gets bumped up to 1.25% if you pay your balance on time (which you should be doing anyway). Plus, you’ll get a $5 monthly credit for the first 12 months on select streaming subscriptions when you pay on time — a nice incentive for a no-annual-fee card.

Related: Review of the Journey Student Credit Card from Capital One

Manage your own finances

Just as imperative as getting the right card is to establishing your credit, it’s equally important to take control of your finances.

You might already have a checking and a savings account, but if your parents have been the ones managing them thus far, it’s time to ask for your own access. Keeping track of your money and your transactions is key to becoming financially responsible and independent.

(Photo by Getty Images)

The same principle goes for credit cards. If you and your parents decide to start building your credit by adding you as an authorized user on their accounts, ask for account access. Some parents may not feel comfortable giving their child a view into the family finances, but they may want to reconsider. By allowing the authorized user to see where they stand against the card’s credit limit and what they’re earning on their spending, they will be motivated to be smarter with their purchases.

Related: Credit cards with the greatest value for authorized users

If you, the student, decide to open a credit card of your own, keep track of your spending and stay on top of your bills, as both play a role in calculating your credit score. Set aside a few minutes to check your account several times per week, if not daily. This will help you avoid missed payments and unnecessary charges from interest fees.

Set your own financial goals

Having a specific goal in mind will help keep you on track — and there’s nothing like the satisfaction of successfully reaching a milestone.

Perhaps your goal starting off is to learn the basics of credit and build good credit card habits. In this case, you may not even need to worry about earning rewards if your intention is to simply ease into the credit card world.

But if your goal is to collect enough points to pay for your spring break trip, find out what you’ll need to spend to earn these rewards. You could earn enough points and miles just from your sign-up bonus, which will have a spending threshold you’ll have to meet in the first few months of card membership.

Related: Cards currently offering sign-up bonuses of 100,000 points or more

Remember that a credit card is not free money

When you get your first credit card, you have access to more spending power. But this isn’t “free money,” and you’re responsible for paying it all back and in full every month.

If you’re new to the travel rewards world, you’re going to want to get familiar with the 10 commandments for travel-rewards cards. Specifically, commandment number one: Thou shalt pay thy balance in full.

Photo by krisanapong detraphiphat / Getty Images

If you don’t and you end up with an unpaid balance, interest will be tacked on. Most travel credit cards carry high interest rates — although a few offer 0% APR for an introductory period — so running up a balance will negate the value of any points or miles you earn. Finally, this bad behavior will take a toll on your credit score, hurting your ability to open cards or obtain a mortgage or other loan in the future.

Bottom line

Getting a credit card in college can be highly rewarding, as debit cards won’t offer you any points and miles. From building your credit to earning points redeemable for travel, the options are practically endless. However, all of this will depend on being a responsible first-time credit user.

Related: How to check your credit score for absolutely free

Official application link: Capital One Journey Student card

Featured photo by Topalov for Getty Images.

Delta SkyMiles® Platinum American Express Card

Earn 90,000 bonus miles after you spend $3,000 in purchases on your new Card in your first 3 months. Offer ends 8/3/2022.

With Status Boost™, earn 10,000 Medallion Qualification Miles (MQMs) after you spend $25,000 in purchases on your Card in a calendar year, up to two times per year getting you closer to Medallion Status. Earn 3X Miles on Delta purchases and purchases made directly with hotels, 2X Miles at restaurants and at U.S. supermarkets and earn 1X Mile on all other eligible purchases. Terms Apply.

Apply Now
More Things to Know
  • Limited Time Offer: Earn 90,000 bonus miles after you spend $3,000 in purchases on your new Card in your first 3 months. Offer ends 8/3/2022.
  • Earn up to 20,000 Medallion® Qualification Miles (MQMs) with Status Boost® per year. After you spend $25,000 in purchases on your Card in a calendar year, you can earn 10,000 MQMs up to two times per year, getting you closer to Medallion® Status. MQMs are used to determine Medallion® Status and are different than miles you earn toward flights.
  • Earn 3X Miles on Delta purchases and purchases made directly with hotels.
  • Earn 2X Miles at restaurants worldwide including takeout and delivery in the U.S., and at U.S. supermarkets.
  • Earn 1X Miles on all other eligible purchases.
  • Receive a Domestic Main Cabin round-trip companion certificate each year upon renewal of your Card. Payment of the government imposed taxes and fees of no more than $80 for roundtrip domestic flights (for itineraries with up to four flight segments) is required. Baggage charges and other restrictions apply. See terms and conditions for details.
  • Enjoy your first checked bag free on Delta flights.
  • Fee Credit for Global Entry or TSA PreCheck® after you apply through any Authorized Enrollment Provider. If approved for Global Entry, at no additional charge, you will receive access to TSA PreCheck.
  • Enjoy an exclusive rate of $39 per person per visit to enter the Delta Sky Club® for you and up to two guests when traveling on a Delta flight.
  • No Foreign Transaction Fees.
  • $250 Annual Fee.
  • Terms Apply.
  • See Rates & Fees
Regular APR
17.24%-26.24% Variable
Annual Fee
Balance Transfer Fee
Recommended Credit
Terms and restrictions apply. See rates & fees.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.